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crimeandpunishment writes:
"When it comes to the world's largest technology companies, is bigger better? Maybe for the companies, but maybe not for their customers. Tech companies, which have spent $350 billion buying other companies over the past few years, have marketed their acquisitions as beneficial for their customers, offering them a broader range of products, and making it easier for one-stop shopping. But changes in customer service may be offsetting any benefit. In the words of the chief information officer for a large association, 'When the smaller guys are gobbled up by bigger guys, in theory it's supposed to be better, but in our experience it's been worse.'"

"The only shares I own"... are of my own company? That's the worst possible situation if your company runs aground... no diversification. I'm not a huge fan of "sector diversification" but I dump my own company shares and invest in things AWAY from my chosen line of work as soon as I possibly can.

Most ESPP shares are bought at a (usually significant) discount anyway, so after taxes for the transaction, you're still (usually) making money.

"The only shares I own"... are of my own company? That's the worst possible situation if your company...

You seem to have chosen to ignore one key word; I wrote "The only shares I own directly..."

I have a fairly diverse portfolio thanks, consisting of stock mutual funds, money market funds, bank CDs, and cash. My ESPP shares are a small -- very small -- percentage of my total investments.

And my company is a Fortune 500 company. While it's not unheard of, it's pretty unlikey it's going to run aground, especially with $11B in cash. As you alluded, the same may not be true of other companies.

And as far as Fortune 500 companies failing... it happens. But that doesn't even matter. You don't need it to fail to make your shares worthless.

Just a stock price drop more than your employee discount... if you get a (generous) 15% discount through your ESPP, a 15% drop in stock price on any company is pretty common, statistically. You then get stuck having to hold them until the compan

Companies know that customers care about one thing: CHEAP! They shop where they do because of low prices. Sure, everybody says they care about service. But 9/10 times they shop where the prices are lowest. Why would Wal-Mart, Best Buy and every airline bother to care about service when they know they'll make more money selling cheap shit and giving the illusion of a bargain? This requires skimping on any extras such as knowledgeable employees.

In short, consumers are their own worst enemies when it comes to the death of customer service.

They shop where they do because of low prices. Sure, everybody says they care about service. But 9/10 times they shop where the prices are lowest. Why would Wal-Mart, Best Buy and every airline bother to care about service when they know they'll make more money selling cheap shit and giving the illusion of a bargain? This requires skimping on any extras such as knowledgeable employees.

Price is transparent, service is opaque. Sure, I could go to a company which claims great service and has high prices, but

So why don't they do anything to reduce the chance of delays, such as not scheduling more flights than an airport can actually handle during a given period of time?

You don't understand the problem at all do you?

The problem is that there's no slack in the system. None at all. One of the reasons is because planes have to fly at minimum distances apart while staying on certain FAA defined routes. (e.g. Your nonstop flight from LAX to JFK isn't the Great Circle Route, but rather a series of straight line segments that do not always approximate the Great Circle. Ever wonder why your flight goes over Denver? Now you know.) One plane on one route runs into a headwind, or must divert for storm (and it always happens), and the entire system begins to backup, and stays backed up for hours, just like a slowdown on the the highway.

Free flight [wikipedia.org] might be able to help with this, but that's the problem. Most popular destinations are at capacity. They're not over capacity, they're at it. What you want is for someone to voluntarily cut back service so that service is improved for their competitors. That simply isn't going to happen. Something akin to congestion pricing might help, but that's not the airline's role. That's the airports and the FAA's. In fact. it isn't clear that the airports could even do that, since they lease the gates exclusively to each airline. They're not simply assigned on a first come first serve basis.

Airlines will collectively schedule as many flights as the local airport authority permits.

If airline A decided to not schedule as many flights at station XYZ, then airline B will pick up the slack and effectively use up that airport's capacity, at least at airports which are at or near capacity, as long as those airlines have passengers available to fill up those flights.

If you have an issue with overscheduling at a particular airport, blame that airport. They're the ones who set those limits, and the air

In essence, you're blaming trucking companies for poor interchange design or low-capacity roads on the interstate system in crowded metro areas.

It should be obvious to most observers that the trucking companies didn't design the roads, and for the most part they don't maintain them, though they might providing funding for such... they just use them.

Delays which occur on the freeways are a function of traffic levels which are, in some cases, now advancing well beyond the original design parameters for those

Wrong, wrong, wrong, and wrong.
Those selected companies did what they did to make money. They do not give a shit about me, or you. They care about profits. I find it insulting when they pretend they care. The only thing they care about is my money.
I am not trying suggesting that they should care about me.

Which again has absolutely fuck-all to do with the question. When was the last time a company did something you like? I'd say it's more often than you'd like to admit, because it's not popular here to admit companies sometimes do things that benefit them that you like.

The company gives you a paycheck because without you (and their other employees of course), they wouldn't be in business very long.They certainly don't pay you because they WANT to. They'd be much happier keeping their money if they could convince you to work for free. Salaries are a huge portion of most companies' costs.

Same with customers. Apple doesn't make iPods because they benefit you. They make iPods because you're willing to buy them (maybe not you specifically, but the more general "you're") and Apple gets money for it. If no one was willing to pay for an iPod, Apple certainly wouldn't continue making them. And flipping the coin, Apple would be quite as happy to sell you a rotten banana peel as they are to sell you an iPod. Apple only "cares" about what you in the sense that you won't give them money for things that you don't want. Caring about the customer is NOT an intrinsic property of a business, its a requirement for that business to be able to make money in a capitalist society where consumers have the option of not buying.

Even monopoly companies have to "care" about their customers in the sense of providing something of utility. A monopoly on rotten banana peels isn't going to generate a lot of income. Even without the option of purchasing from a competitor, the option of not buying at all is still available to consumers.

At least for most products. These arguments break down in the face of "necessary" products such as electricity, running water, food, etc. Now food isn't so bad because you generally have the option of multiple suppliers, and competition keeps things fair. No such competition exists for things like electricity and water (at least in most cities). For those products, you can neither decide to purchase from a competitor nor decide not to purchase at all. As an off-topic rant, this is the reason why I consider "privatizing" these sort of products to be a terribly bad idea -- all of the monopoly power of a public utility with none of the public oversight. Pretty much bad for everyone except the new CEO and whoever he paid off to make it happen.

No such competition exists for things like electricity and water (at least in most cities). For those products, you can neither decide to purchase from a competitor nor decide not to purchase at all.

Well, you can "kinda sorta" - you could build an outhouse in your backyard or a full septic tank in your backyard, provided your local building code allows it. You could install a rainwater collector, filtration system, or simply purchase what water you need from an alternate supplier (though at the cost per gallon, that's suicidal). You could, provided the groundwater quality in your area isn't shit and again that local building codes would allow it, even dig your own well and install your own pump.

You could install a gas/propane/etc generator, or solar cells and some battery storage, if you want to try to go without being "plugged in" to the electric grid, or you could even do without air conditioning and heat what you need to in your house with some other form of heating like a wood-burning stove or fireplace. You could your cooking on a propane or charcoal grill.

Of course, good luck managing to do this in any major city or if you have kids, unless you're Amish or Mennonite. Raise kids in that environment, and the local constabulary will be up your ass with "child welfare" authorities in tow, looking for any excuse they can manufacture to take your kids away and force you to pay up for local utilities...

Just in case anyone cares, it is illegal to collect rain water in Colorado (and probably other mountain states) unless you own the right to do so. I'm not commenting on whether it's a good idea or not, just mentioning it because.

No such competition exists for things like electricity and water (at least in most cities). For those products, you can neither decide to purchase from a competitor nor decide not to purchase at all.

Well, you can "kinda sorta" - you could build an outhouse in your backyard or a full septic tank in your backyard, provided your local building code allows it. You could install a rainwater collector, filtration system, or simply purchase what water you need from an alternate supplier (though at the cost per gal

Doing something that you like doesn't mean they care about you, and I've never implied that they did. They do things that make sense to them -- I've never implied otherwise. You like some of them, you don't like others. But you can't honestly make a blanket statement that they never do anything that customers like.

Many small businesses and sole proprietors actually DO take pride in actually making the customer happy (as opposed to just happy enough to buy again). It's somewhere in that gray area where the business starts to take on it's own identity distinct from it's owners' that it ceases to actually care about the customer and begins merely aping care (like any successful psychopath will).

Do not discount the effects of the consumerism mindset ("You have to buy rotten banana peels or the economy will fail!") combined with the psychological effect of marketing ("Buy now! Cheaper rotten banana peels than ever before! Your life isn't complete without a yearly supply for easy payments of 19.95$ + S&H!") and neighbouritis ("Honey, the neighbour already has banana peels, why don't we?") on what customers are willing to buy.

Though I feel your cynical view and agree it's probably the usual case, there is more than sufficient evidence to suggest that a genuine desire to please and benefit customers drives at least some businesses. They may be smaller, or only rare, but that's the same thing in nature. The trend would map to symbiosis where one organism relies on another cooperatively for mutual benefit. A balanced relationship between a corporation and its consumers forces this mutual benefit scenario as the corp needs the customers for income and the customers need (or at least think they need) the corp for some product or service. However, when the customers lose their alternative options, the failings of the corporation no longer have the same level of negative effect on the corp as they might have otherwise because said consumers have nowhere else to go.

Of course, this is why monopolies are bad. However, it's probably worth realizing that less-than-monopolies are also bad in exactly the same way. Good examples of this are Wal-mart, FedEx/UPS, and Google. All of these companies take their positions for granted and abuse them one way or another with little recourse as they have few if any general competitors. Though they may offer some good things like broad areas of service or one or two worthwhile operations, they generally pose a threat to any potential competition or even actively stifle it through business practices that only a monopoly could afford (like massive price undercuts or underpaid employees, questionable service, or invasion of privacy.)

Unfortunately, this situation is an eventuality of all capitalistic business pursuits. Either businesses will fizzle out and fail or they will grow, become part of or overtake other businesses to get into a monopoly position. It's unclear if there could ever truly be an amicable solution that prevented this.

The severe limitation of corporate charter would help a lot. The point where a business gets large enough that no person in it feels that it's treatment of customers will reflect on their personal character is the point where things go seriously wrong.

That is at least a large part of why Smith was not in favor of large businesses.

Once you eliminate that, businesses have a third possible state where they grow to a practical size and remain there doing what they do well and support their owners and employees.

But only after I spent a week calling their cancellation line that was, inexplicably, always "closed." And then, only after I pointed out that it was entirely within my power to cancel myself by not paying them (and keeping their modem.)

Corporate actions that benefit the corporation (shareholders, management) rather than customers. And further benefit the bankers, lawyers, consultants, bankers, lawyers and more consultants.

Who the fuck cares about the customers anymore?

This seems to be a 'duh' article. We've seen this in so many sectors these days - aerospace (YoYoDyne^HBoeing), Banking (Goldman-Sachs), Energy (BP, ExxonMobilShellTexacoAndThousandsOfOtherCompanies). I can't think of any of these industries where customers benefited

Who cares about the customer, in most instance those small and mid sized companies run by their owners. Those companies that a lot of people shift their purchases to once they discover them (they do take some discovery as they spend their money on customer service not B$ advertising).

These of course are the very same companies they get bought out by corporate executive serving companies (nepotistic, anti-customer, corrupt corporations). They are simply buying out the competition and of they deem it worth

If people really want this free-market capitalist monstrosity, then they need to accept the fact that what is best for the *company* always comes first. It really irritates me every time I hear people complaining that a corporation is not thinking of its customers first, or its employees... That is not a corporations job. They're one and only job is to make money for their shareholders.

If you don't like this--as you shouldn't--then the system itself is what needs to be changed. Don't blame the individual companies--they are doing exactly what we have set them up to do. Capitalism itself is the enemy.

That is not a corporations job. They're one and only job is to make money for their shareholders.

I don't see how that statement is a necessary and unavoidable part of capitalism. Capitalism is just an economic system that relies on people freely making economic transactions with each other. It does not inherently require the concept of "shareholders" and even the idea that a corporation needs to have owners is not absolute - a corporation is just a relationship between employees and customers, it does not need to have owners any more than the marriage between a man and his wife needs to somehow be owned by someone. There are lots of (unfortunately, small) businesses that do serve their customers, but we can, and should, support them.

While the exact form of it (the legal fiction of a limited liability corporation) isn't inherent in capitalism, the argument that this sort of concentration of wealth and ownership is an inherent aspect of capitalism was really the central point of Karl Marx's Capital. The way that most civilized countries prevent that problem from overwhelming them is via the use of democratic government to check the power of owners in favor of everybody else.

The big exception to this has been the United States since 1980. Anyone complaining about excessive taxation or regulation today ought to read up on what US law looked like in 1960 or so.

The big exception to this has been the United States since 1980. Anyone complaining about excessive taxation or regulation today ought to read up on what US law looked like in 1960 or so.

Anyone who complains the USA doesn't have enough taxation and regulation needs to read Alexis de Tocqueville's [tocqueville.org] Democracy in America [amazon.com]. The one problem with the era it was written in was slavery.

There's a key difference between the USA de Tocqueville wrote about and the USA that Marx and Engels wrote about: The Industrial Revolution had begun to concentrate ownership of economic output in the hands of those who had the means of owning factories.

Now, some concentration is understandable: for instance, my great-great-grandfather invented a method of condensing milk, started a company (which is still the biggest brand in the business), and made a fortune. What's less understandable is that because my

There's a key difference between the USA de Tocqueville wrote about and the USA that Marx and Engels wrote about: The Industrial Revolution had begun to concentrate ownership of economic output in the hands of those who had the means of owning factories.

Yea and slavery was abolished. However abolitionists were fighting to stop slavery even before de Tocqueville came to the USA. In his original drafts of the Declaration of Independence Thomas Jefferson [monticello.org] wrote of equal rights for everyone including Blacks an

FRB requires an organisation to grow in order to pay the interest on it's debts. They continually have to generate more and more revenue. So they take out some bigger loans and gobble up competitors and get bigger. Rinse and repeat. Eventually there will be only one corporation, owned by the bank.

The idea of the corporation is the problem. Capitalism works when one person decides how much risk he wants to undertake in order to gain something. Corporations take much of the risk away by spreading it out among thousands of shareholders. Without that risk, and associated responsibility, corporations can game the system. If companies were run by individuals they would rise and fall like they are supposed to under capitalism. As corporations they can linger on almost indefinitely because they are so

It really irritates me every time I hear people complaining that a corporation is not thinking of its customers first, or its employees... That is not a corporations job. They're one and only job is to make money for their shareholders.

No, that's a corporation's fiduciary purpose. What their "job" is depends entirely on who you are.

If you work for a corporation, their job is to keep you dutifully employed.

If you supply a corporation, or sell its goods, their job is to buy the things you make or making the things you sell.

If you're a government, then a corporation's job is to improve the life of your citizenry, by engaging in a healthy marketplace.

And if you're a CUSTOMER of that corporation... well, then their job is to make you happy, a

The clumsy sleight-of-hand that Capitalism: A Love Story tries to pull off, is to frame the issue as Capitalism vs Democracy.

If there was any lesson of the cold war it was that economic systems and political systems are orthogonal. You can have Democratic Socialism. You can have Democratic Capitalism. You can have a Socialist Dictatorship. You can have a Capitalist Dictatorship. Mike Moore wants Democratic Socialism, all the way down to the individual business..

Actually no, I had considered seeing the film but never got around to it.

Capitalism isn't exactly "incompatible" with democracy, however it creates a heavily class-based society, relying on a very large middle and lower class with less education. And a majority of the population having less education than the rest *is* incompatible with democracy. If we were able to properly educate everyone, it might be a different story... But now most people don't even know when they are being had... They'll happily

Individuals making economic decisions based on their own personal preferences is a feature of both systems.. It's so hard to have a conversation with Americans about Socialism because they're just so indoctrinated with false information. Moore exploits this rather than try to educate.

No, the one and only job of a corporation is to benefit the common or public good. In return for doing they are given limited liability. The first two corporations granted charters were the Dutch East India Company [wikipedia.org] in 1602 and the British East India Company [wikipedia.org] in 1604 just for this reason. The Dutch and British believed trade benefited the public yet shipping was risky. Both companies were shipping companies shipping cargo like tea from India

The individual companies do exist only to survive (meaning that they will turn a profit, however they can). But, I think you are buying in to the teabagger rhetoric that anything less than an unregulated laissez faire marketplace is socialism. This is simply untrue. The government should exist to maintain a capitalistic system, even if that means using regulations to ensure fair competition in the marketplace.

As for democracy vs capitalism, capitalism is the purest form of democracy. It is mob rule, with no

I hear this trumpeted time and time again, and it fails to take into account one major factor: the human element. Employees who care about their jobs and enjoy working for a company produce better results. The easiest way to have people care is providing a good working environement and being as ethical as possible. I've seen this time and time again as I've worked for different companies.

It is in a companies' best interest to make money while at the same time being ethical and providing a good working e

The mom-and-pops are already out of business. So when we are talking about "corporations," it's really only large ones. The whole point of this article is that corporations are unable to achieve all three of these goals, so their new goal is to form a monopoly, that way they don't have to worry about making customers happy because customers have no other choice (I work for an airline--believe me, I know!). They don't have to care if the employees are happy because the economy is in such poor shape that a

I know some people who run their own businesses proving you wrong. My sister is one of them, with friends of hers she started an accounting business. She used to work for Ernst & Young [ey.com] but no longer.

Uh, what world are you living in? You must be in the U.S. if you fly on SW... I'd be thrilled to find a place here where small, independent businesses are actually thriving, but one doesn't exist. Of course there are still some struggling for survival, but they are falling at an accelerating rate and there is no end in sight. I hardly think this is some kind of outlandish statement I'm making--it's pretty common knowledge. If we are on "different pages" it is because you are flat-out in denial!

I'd be thrilled to find a place here where small, independent businesses are actually thriving, but one doesn't exist.

Maybe where you live small businesses may be hard to find but not where I am. My sister runs her own business as do others I know or knew. I'm hoping to start my own small business. Now I know it's hard in some places, like Europe, but not in the US. Here's the small business stats [census.gov] from the US Census Bureau. The stats are a bit out of date, the latest numbers are from 2004 but I doubt t

So where do you live, exactly? I've been in cities all around the U.S. and have seen basically the same thing everywhere. Perhaps in some really small towns independent businesses have been able to hang on a little bit longer, but there's always a Walmart or something else that goes up to eliminate them eventually.

And there are a LOT more small businesses in Europe than in the U.S... I was actually going to use that in a counter-example in my previous post but decided it wasn't relevant. I'm talking act

The Twin Cities of Minneapolis/St Paul with a population of more than 3 million [about.com]. Two block from me there's a privately owned convince store some of my neighbors work at, with many more small businesses on the same street. Several blocks in the opposite direction there's more small businesses. I'd say the area was Asian however there are also African shops, a cafe, and a German restaurant in walking distance. In a third direction there's more independent businesses. The four

How very bizarre... I live in Minneapolis as well, in uptown in fact, one of the neighbourhoods which I would say is still trying to hold on at least a little bit. And what do we find here? They try to gentrify everything by putting chain stores in...Victoria secret, Urban Outfitters, McDonald's, Arby's, Rainbow, Starbucks, T-Mobile, on and on... And this is in a "good" neighbourhood! You go downtown and you hardly can find any independent places, it's chains everywhere, and lest we not forget how awfu

p>How very bizarre... I live in Minneapolis as well, in uptown in fact

Then you must know about the shops on Hennepin, Lyndale, Nicolet Mall, Lake St, and Lagoon. You don't know about all the shops on these streets? Or on Excelsior in St Louis Park? Well perhaps driving around blind you miss them, me I ride my bike in the area, it the area I live in too. Heck, you don't know Muddy Waters [officelive.com]? Or Penn Cycle [penncycle.com]? Loon Grocery [yelp.com]? Those are just the ones my bad memory can come up with right now. Oh and the Wedg [wedge.coop]

Their strategy is to keep most of their customers just barely satisfied to come back to them rather than the competition (keeping in mind that's what the competition is also doing) and to keep the employees just barely happy enough to prefer their job to starvation in the streets. The race to the bottom is built into the system.

That doesn't sound like a very good world to actually live in though.

If you keep things at about the Mom-and-Pop size, personal ethics put the brakes on that race to the bottom and a

Their strategy is to keep most of their customers just barely satisfied to come back to them rather than the competition (keeping in mind that's what the competition is also doing) and to keep the employees just barely happy enough to prefer their job to starvation in the streets. The race to the bottom is built into the system.

You are still running with a flawed belief. The race to the bottom is not built into the system. The system is for improving the lives of all who participate in a willing exchange

You are still running with a flawed belief. The race to the bottom is not built into the system. The system is for improving the lives of all who participate in a willing exchange of goods and services, ie a free market. Just because you believe in communism or socialism does not change the facts.

But your beliefs do somehow change the facts?

Doubtful.

You assert that corporations today actually try to pay employees more than the bare minimum they can get away with? They charge their customers less than the maximum they can get away with?

If so, since when?

The checks and balances that prevented that have been removed one by one until finally we have reached a new system only vaguely related to the old Capitalism. The race to the bottom is built in to the new not-really-capitalism.

You assert that corporations today actually try to pay employees more than the bare minimum they can get away with?

I did not say that, or anything like it. Employers, not all but most, will pay what the market will take or demands. And the market? It's the workers. If enough workers with specific education, skills, or training demand higher pay and refuse to work otherwise employers will have to pay that, that is if they can. Now if the compensation demand is too high, as it was for the Detroit auto ma

Note: you're not actually disagreeing with the poster that you reply to. The obsession with growth is entirely an artefact of the market. If you have a private company and it is making a constant annual profit, you are generally happy. If you can make it grow, that's great, but if you can't then it's still giving you an income and you can invest spare money in something unrelated if you want to - maybe start another, unrelated, company.

"That's an awfully nice computer you just described to me. Sure would be a shame if someone came by and crushed it. Are you interested in an extended warranty?"
"Are you talking to me? Are are you talking to me? I will destroy you!!!"
"Oh hello little girl, sure I'll help you. You know, I'm in here for being a friend to a little girl just like you."
"How the hell should I know, I steal 'em, I don't fix 'em"

Funny, our customers say the same thing! When they call for technical support they get someone speaking english with a horrible midwestern american accent!

(We have more clients in the UK, Australia, New Zealand and Canada then we do in the States currently. So even though they are dialing a local in country number, it's being VOIPed to our office in St. Louis, Missouri!)

Takeovers are about reducing competition and increasing market share so the don't need to compete. One serious flaw in capitalism is that companies don't want to compete because it's difficult and generally not very profitable.

Yes, more efficient. Unfortunately, without the diversity and wide competition you get limited choice and unhealthy markets. They end up directing all of their efficiency at hoovering your wallet and giving you practically nothing in return.

Once corporations get large enough, they become indistinguishable from Soviet style planned economies except they don't even have to pay lip service to the workers.

This past week I had two very interesting customer service experiences -- interesting because of just how different they were.

I spent probably 5 to 7 hours on the phone with HP technical support last week, trying to get them to assist me with a problem we were having with a pair of ProLiant servers. I was shuffled around to multiple departments (and, judging by the various accents, I would say I was probably shuffled to multiple continents as well), each one telling me that the next guy was the right guy to talk to about our issue (which of course he wasn't). This was for a fairly simple question about the functionality of one of their server administration tools, that no one seemed equipped to answer.

Conversely, we also had a hard disk in a ProLiant server go bad. With the serial and part numbers in hand, I was able to get a replacement shipped within 10 minutes.

The two completely different experiences I had suggests to me that when companies get large, they get very good at handling the common support problems, like bad hard disks. They develop procedures that save both the company and the customer lots of time, and are relatively painless. But what's lost is the ability to handle the out-of-the-ordinary service needs that customers have; the company is just too big, and the support guy (let's be frank, in some call center in India*) just doesn't have the resources or the knowledge to handle the problem. This leads to a frustrating experience -- whereas in a small company, these things tend to be handled quickly, because the support guy can escalate easily.

*HP doesn't even try to hide that their support is outsourced to India. If you log-on to their professional support, you can tell right away by the names.

"But what's lost is the ability to handle the out-of-the-ordinary service needs that customers have; the company is just too big, and the support guy (let's be frank, in some call center in India*) just doesn't have the resources or the knowledge to handle the problem."

Sorry, but this IS intentional. Good support costs money-either upfront by designing products that don't require it or providing it. It's not bureaucracy that makes it hard to escalate a problem, it's policy.

HP doesn't even try to hide that their support is outsourced to India. If you log-on to their professional support, you can tell right away by the names.

What I really hate is when they tell their outsourced tech support representatives to lie to you about their names. They don't do it quite so much over the phone any more (I guess that's just too blantant), but you still get it in e-mail and chat conversations - you'll get people who claim their name is "John", but use the word "query" instead of "question"

I have to say that Adobe tech support is quite possibly the absolute worst tech support I've ever seen from a major company.

For me that distinction goes to Gateway. The first PC I bought was from them and every tyme I called tech support, almost once a month in the first year, I'd be asked if I recently installed anything. If so I was told they do not support that, the only way to get the support is if I uninstall it or reinstall Windows and nothing else. They didn't get much more business from me.

This leads to a frustrating experience -- whereas in a small company, these things tend to be handled quickly, because the support guy can escalate easily.

If it's a real small company, the support guy doesn't escalate. He just handles it because he's all the support. (And sales and development too; I know a few guys who run their own small companies doing this sort of thing.) He offers good support because that's his big edge over the big firms.

Not so much the size as the MO of large IT companies. Create a shell of sales, marketing and consulting while all development, maintenance and support is hollowed out and internally "outsourced" to units in very cheap countries. Even though the quality of all three go down they manage to win bids by in theory offering the same as their competitors for less. In practice it turns out much worse than expect, but that's quickly forgotten during the next round of contracts again with a tight budget.

A small company that has a few clients is more likely to provide very good support, as opposed to a large company with many clients. While large companies support large companies well, due to their capacity to effect change at scale, this is not the case of large companies supporting smaller companies. Typically, while say an account manager at a small company might do several things to streamline the benefits that their client(s) see, this may not be the case with larger companies which rely on various pro

Something like half of all mergers/acquisitions fail to generate the returns expected. In such cases, it's usually the shareholders of the company being bought that reap the benefit (assuming they can dump whatever stock of the acquiring company they receive as part of their payment).

Think about it. It's basically a coin flip that company A buying company B will result in any benefit to the shareholders of A. If shareholders were truly wise, they'd tell management to just give them the cash they would have spent on acquiring a company. They'd make out better in the long run.

Think about it. It's basically a coin flip that company A buying company B will result in any benefit to the shareholders of A. If shareholders were truly wise, they'd tell management to just give them the cash they would have spent on acquiring a company. They'd make out better in the long run.

That does not follow. If half the acquired companies fail completely (i.e. produce 0 return) and the other half produce at 3x return, the shareholders of the acquiring company come out ahead too.

It wasn't until the late 80's IIRC, that the first software company takeover occurred: PR1ME Computer and MAI Basic4.

Up until then, software companies lived (and died) on their own. Though there was an awareness of takeovers in other industries, there was a pervasive sense that it would never happen in high tech. (At least at the companies I worked at.)

Then MAI Basic4 proposed a hostile takeover of the MUCH larger PR1ME Computer (where I was working at the time.). PR1ME took on a huge amount of debt to raise funds to buy out Bennet S. Lebow (sp?). Then followed several rounds of cost-cutting and layoffs.

I've survived several others since then. In every single case it had NO BENEFIT to the customer that I could see; it was ALL about corporate profits.

Yes, I know anecdote is not the singular of data, but thought I'd toss my first-hand experience into the discussion. (BTW this occurred not very long after Robert Morris unleashed the first internet worm; I was at PR1ME when that hit, too.)

Most people only consider one class of "customer" when they make these comments -- those customers that the small company originally had. The small company is by definition, small. The loss of a single customer (especially a larger customer with a lot of licenses) can be a disaster. So they spend a lot of time and money catering to their customers in the form of directed enhancements, timely bug fixes, support staff that know the product (and frequently the OS, other common products, etc that might cause

While I am somewhat skeptical of a lot of the take-over-artistry that goes on, regardless of industry sector(there seem to be a number of places where, under the right circumstances, you can make substantial money by causing even more destruction that gets externalized in various clever legal-but-slimy ways. Any circumstances that encourage the best and brightest in finance to act as, in essence, high class smash-and-grab thieves is pathological any way you slice it.) I find the tech takeovers introduce an extra complication:

Software maintenance and development is Hard. Much ink has been spilled on the Best Practices of doing it; but a lot of firms are still just barely hanging on. Any disruption to their development process or roadmap can set them back months or years. Since, in many cases, the point of doing a tech acquisition is to offer a "total package" or a "solution" or a "suite" this means that, in addition to all the institutional and job-loss shakeups, you suddenly have two or more development teams, each bringing its own nasty legacy baggage to the party, trying to mash their products into some sort of "integrated solution".

At best, this is an evolutionary process. Over a period of time, they manage to evolve the products toward one another and eventually end up with something nice and coherent and refactored so forth. More commonly, major differences and glaring integration issues persist longer than the customer would like, and niggling little oddities persist for years. Sometimes, some mental giant decides to solve the hard problem of legacy by throwing one of the products away(generally the one that isn't his baby) and re-writing it from scratch in the idioms of the other product. Hello major feature and stability regressions...

We use Altiris some at work, and they were recently aquired by Symantec *scary background music plays* who has embarked on the "rewrite virtually from scratch" path. They have some sort of pie-in-the-sky vision of a "Symantec Total Endpoint Management Solution"; but, until they get that working, their support for the last pre-takeover version has gone to shit and the N+1 version has massive feature regressions, including stuff we use all the time, all over the place, and is thus unusable to us. Unless they get their act together fast, we may be forced to bail entirely. Win7 finally has something resembling adequate first-party imaging and deployment features, and there are other tools, including some OSS, for system inventory and remote control....

Interesting that so many have asserted that the purpose for these large-scale mergers and/or acquisitions is to produce value for the shareholders.
Any number of economic studies have shown that after a few years, the majority of such result in reduced shareholder value.
A handful of executives make a lot of money;
the investment bank(s) that orchestrate the acquisition make money;
the shareholders on either side, not so much, if at all,
unless they cash out quickly.

There are different sort of takeovers, and they benefit different sorts of people.

For instance, when Microsoft bought FAST and incorporated the search into Sharepoint they made their sharepoint customers happy, however at the same time they ceased all development on the Unix and Linux versions. This merger obviously provided benefits to people, but not necessarily to the customers of the small entity.

As another example, when Oracle bought Sun, service went down hill rather dramatically and costs went up, on